Disruptive Impacts By a Symbol of Economic Growth: The Case Study of Shinkansen Railway

Why does a public construction project cause environmental and social disruptions and become irrational in terms of economic and social aspects? In this presentation, we will consider the case study of a high-speed railway network called Shinkansen in Japan. Analysing the decision-making process by the strategic analysis, we will point out the fragmented process that makes a project irrational.

Since the opening of the Tokaido Shinkansen in 1964, the first Shinkansen, this railway network has expanded to seven lines. The Shinkansen has been considered as a symbol of economic growth by most people. Some researchers argue, however, that this huge project has caused n and social disruptions in a chain reaction.

In contrast to the Tokaido Shinkansen, which has over 600,000 passengers a day, the Hokkaido Shinkansen, which opened in 2015, has around 7000 passengers per day. Naturally, the Hokkaido Shinkansen is unprofitable.

The unprofitability causes some social disruptions. First, the national and local governments provide the construction cost even though most of them are in financial crisis.

Second, local governments and municipalities must agree that Japan Railway Companies cancel the operation of local railway lines. This is because Shinkansen robs passengers from local express trains, putting pressure on the company’s management. Most local governments have established semipublic railway companies for cancelled lines with financial burdens.

Costs for Shinkansen construction and management of new railway companies are such heavy burdens for local governments and people that they are suffering from the rapid population decrease and financial crisis.

Third, these Shinkansen lines also disrupt natural environments (e.g., waterway destruction, land subsidence).

People may welcome a local opening of the Shinkansen but this unprofitable and irrational infrastructure can then become a burdensome legacy in the near future.